A limited constitutional government calls for a rules-based, freemarket monetary system, not the topsy-turvy fiat dollar that now exists under central banking. This issue of the Cato Journal examines the case for alternatives to central banking and the reforms needed to move toward free-market money.

The more widespread use of body cameras will make it easier for the American public to better understand how police officers do their jobs and under what circumstances they feel that it is necessary to resort to deadly force.

Americans are finally enjoying an improving economy after years of recession and slow growth. The unemployment rate is dropping, the economy is expanding, and public confidence is rising. Surely our economic crisis is behind us. Or is it? In Going for Broke: Deficits, Debt, and the Entitlement Crisis, Cato scholar Michael D. Tanner examines the growing national debt and its dire implications for our future and explains why a looming financial meltdown may be far worse than anyone expects.

The Cato Institute has released its 2014 Annual Report, which documents a dynamic year of growth and productivity. “Libertarianism is not just a framework for utopia,” Cato’s David Boaz writes in his book, The Libertarian Mind. “It is the indispensable framework for the future.” And as the new report demonstrates, the Cato Institute, thanks largely to the generosity of our Sponsors, is leading the charge to apply this framework across the policy spectrum.

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Archives: 12/2009

InsideDefensereports ($) that the White House’s Office of Management and Budget will give the Pentagon a spending increase – two percent real budget growth annually from fiscal years 2011 to 2015. The boost amounts to $60 billion over the period. The proposed FY 2011 non-war military budget will therefore be $556.4 billion rather than $541.8. That’s a win for Secretary of Defense Robert Gates. Previous plans had called for spending to grow only with projected inflation–0 percent real growth–but Gates resisted, arguing that the cost of defense programs grows faster than inflation.

The growth would relieve pressure on research, development and procurement spending on weapons and platforms. Embracing counterinsurgency has caused the military to spend more on labor and less on technology. The wars have encouraged Congress to annually increase benefits and pay for military personnel and veterans while expanding the size of ground forces. Thus real personnel costs, which Jim Arkedis recently estimated at over $300 billion a year, have soared. If overall spending doesn’t rise, the easiest place to find money to cover these costs is in new technology. You can’t really cut operational costs, which are also growing, without cutting the size of the force.

Those dynamics encouraged Gates’ proposed cuts to big ticket procurement items, like the F-22, last spring. His acolytes called him a revolutionary, but he was just balancing the books. The cuts harmed the high-technology end of the defense industry and outraged the Congressmen who protect the jobs it provides. As Stephen Daggett of the Congressional Research Service shows in this October House testimony, more procurement cuts were inevitable without a spending boost. This one isn’t big enough to solve the problem, but it mitigates it. That’s too bad, because the technology/manpower fight was pushing more of the military-industrial complex to attack the counterproductive idea of fighting terrorism with counterinsurgency.

There is some grounds for hoping that the spending increase won’t occur. OMB issued a half-hearted denial, saying that the President hasn’t decided yet, and, in general, future defense spending plans rarely hold up. New actors and pressures emerge with time. Still, for those of us who want a restrained defense posture, which would allow massive spending cuts, this decision, like the double-down in Afghanistan, is dissapointing but not surprising.

Obama seems to have convinced Fareed Zakaria that he wants to cut down on defense commitments, but there is no evidence of such thinking in his administration’s personnel and stated defense goals. The administration wants the military that most of Washington does, one meant both to cause social transformation in unruly states and so dominate the world that allies and enemies don’t explore their own military potential. I don’t know what the minimum cost of chasing those dreams is, but clearly it’s not cheap. Gimmicky efforts to legislate away procurement overruns may hoodwink liberal defense spending skeptics, but they don’t save real money. That requires lessening your defense ambitions. Plan for less war, and you can cut force structure and buy and hire less.

Like Jim, I watched this morning’s Open Government Initiative launch with an eyebrow reflexively arcing skyward. Like Fox Mulder, I want to believe, but it’s not just the track record that gives me pause; it’s the tension in one of Vivek Kundra & Aneesh Chopra’s answers to a pointed question that came in from the Web: How do you actually implement this? How do you get all the agencies on board, persuade (or compel) them to open up, embrace openness, and free their data? Because the public pitch is that the great benefit of open government is accountability, which requires information that may reflect badly on an agency and generate bad publicity to be released. But since they’re limited in their ability to enforce this on an alphabet soup of agencies, the pitch to leaders within government is: Imagine how cool it would be to have the entire population as your clickworkers. So transparency is carrot and stick in one—a carrot stick, if you will: Take a nibble between thrashings, it’s delicious! This is not totally crazy, since there will probably be data whose release opens an agency to greater scrutiny, but still benefits them on net because it lets some tasks be offloaded to the cloud. But insofar as those two things come apart, it’s not hard to guess which one agencies will want to focus on, and the mandate to ensure “data quality” makes a good stock excuse for withholding.

I don’t want to be entirely cynical, though, because openness—as I’ve harped on before, and as Jim often stresses—can be an important structural limitation on government. And if I can riff for a moment, I think it’s worth distinguishing two aspects of “limited government” through the lens of the argument F.A. Hayek makes in his seminal The Road to Serfdom. Very crudely, the idea goes something like this: As government takes on responsibility for ever more complex forms of planning, via a growing tangle of interdependent rules, it becomes increasingly difficult for that power to be checked by democratic mechanisms. Expansion in the scope of state authority goes hand-in-hand tends to be associated with more centralized, opaque, and autocratic exercise of that authority, compounding the disempowerment of ordinary citizens. Call them, if you want to be dramatic, the Orwell problem and the Kafka problem, respectively. But state functions that are not amenable to democratic oversight by the crowd may be amenable to peer-produced oversight by the cloud. Libertarians focus—with good reason—on limiting the scope of state power, which we might think of as a kind of external boundary. The internal boundaries are at least as important. But folks who are centrally concerned about limited government don’t often choose a career in the federal bureaucracy, and the ones who get elected to office, let’s face it, often lack the skill and disposition for the nitty gritty details of governance.

One implication of this is that a more open and networked government, if it ever does come about, may demand a disorienting cultural shift of libertarians—where on top of the big political-philosophy level ideas, it begins to behoove us to pick a pet agency and get interested in the profoundly unsexy details of how it operates. It lacks the frission of taking to the streets quoting Paine, to be sure, but at least engagement no longer demands more pernicious incentives—either venal or, heaven forfend, idealistic.

Senator Tom Coburn’s (R-OK) office has released a new report documenting 100 examples of questionable stimulus spending. From a public policy perspective, it’s a tidy illustration of why the government doesn’t do a very good job of spending other people’s money. In terms of entertainment value, it’s a pretty amusing read in a sad sort of way. Although, I do have one question for the Coburn staffers who included the story of a cruise company receiving a million dollars in anti-terrorism funds: Did you not see Speed 2?!

Why the Supreme Court should strike down the Public Company Accounting Oversight Board: “Imagine a government agency with the authority to create and enforce laws, prosecute and adjudicate violations, and impose criminal penalties. Then throw in the power to levy taxes to pay for all the above. And for good measure, make the agency independent of political oversight.”

A good vocabulary word–and an important rhetorical device–that kids should learn is “hyperbole.” Indeed, in Los Angeles the teachers union has apparently thought illustrating hyperbole so important that the union has, on its own time, provided a crystal clear example of it. Talking about a proposed 11.75-percent pay cut to control the Los Angeles Unified School District’s red ink flood, United Teachers of Los Angeles elementary vice president Julie Washington declared that she’s afraid “with a 12 percent pay cut we’ll see homeless teachers…”

That’s a deliberate exaggeration, alright! According to a February Los Angeles Daily Newsreport, the average LAUSD teacher makes $63,000 a year. Even the lowest paid LAUSD teacher makes nearly $46,000. Meanwhile, according to the News, the average household–not single person–income in Los Angeles County is only about $73,000. So right now the household income of two average LAUSD teachers would be $126,000, almost 73 percent higher than the county average. A household of the lowest paid teachers would also substantially beat the county average, hitting $92,000. Presumably, that means that right now L.A. teachers can afford way better than average housing, much less no housing at all.

Would a 12 percent pay cut change that? No way! The average household of teachers would still make almost $111,000, and the lowest-rung teacher household would make nearly $81,000.

So thank you, UTLA: You’re always looking to set up teachable moments, and this time you’ve succeeded with hyperbole!

Yes, folks, it’s the moment we’ve all been waiting for: John Stossel launches his new weekly show on the Fox Business Network Thursday evening at 8 p.m. (Even though the vaunted Fox News machine can’t seem to put a notice about it on their website, I have it on good authority that the show will go on!) Rumor is he’ll be talking about Ayn Rand on the first show. It’s a good time for a show about freedom and limited government – as the Baltimore Sun says, “Stossel’s new show should have no trouble finding an audience of viewers eager for a discussion about the pedal-to-the-metal pace of expansion [of government] since Barack Obama took office.”

Some people ask, Why give up ABC for the smaller Fox networks? (Presumably, these are not the same people who asked Stossel for years, “Why don’t you go to Fox? They’d love you there.”) The good news is that now Stossel has an hour a week to talk about freedom – as well as appearances on other Fox shows such as Beck and O’Reilly. His hour-long specials at ABC were excellent, and drew solid ratings, but ABC hasn’t put one on in more than a year. And even his “Give Me a Break” segments on 20/20 had become rare. So what’s the point in being part of a big but declining network that isn’t actually interested in serious political commentary? Now he’s on a smaller but growing network that wants him to do 44 hours of pointed commentary and analysis, plus contribute to other shows.

If you haven’t seen Stossel’s ABC specials, you need to. I can never decide which one I think is best. Of course, I’m partial to “John Stossel’s Politically Incorrect Guide to Politics,” in which I get a bit of screen time. But “Greed,” with Walter Williams, David Kelley, and Ted Turner, is great, too. And so is “Is America #1?,” featuring Tom Palmer. But there were plenty of others – “Stupid in America,” “Are We Scaring Ourselves to Death?,” “John Stossel Goes to Washington,” “Sex, Lies, and Consenting Adults.”

You can view some of them, including “Is America #1?,” at a website called Freedom Channel. And for the time being, at least, you can still watch lots of shorter Stossel videos at ABC News.

But meanwhile – tell your mama, tell your pa, to watch “Stossel” this Thursday at 8 p.m. on Fox Business Channel. And note: it will repeat at 10 p.m. Friday, giving you a chance to show ABC what they lost by watching “Stossel” instead of “20/20.”